If you're an AT&T customer, it's time to start paying attention to how much …

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Starting today, AT&T will begin restricting more than 16 million broadband users based on the amount of data they use a month. The number-two carrier’s entry into the broadband cap club means that a majority of American broadband users will now be subject to limits on how much they can do online or risk extra charges as ugly as video store late fees.

The new limits—150 GB for DSL subscribers and 250 Gigabytes for UVerse users (a mix of fiber and DSL)—come as users are increasingly turning to online video such as Hulu and Netflix on-demand streaming service instead of paying for cable.

With the change, AT&T joins Comcast and numerous small ISPs in putting a price on a fixed amount of internet usage. It’s a complete abandonment of the unlimited plans which turned the Internet into a global behemoth after the slow-growth dial-up days, when customers were charged by the minute and thus accessed the internet as sparingly as possible.

Comcast’s limit, put into place after it got caught secretly throttling peer-to-peer traffic, is 250GB—which the company says less than 99 percent of users hit. AT&T plans to charge users an extra $10 per month if they cross the cap, a fee that recurs for each 50 GBs a user goes over the cap. And while 150GB and 250GB per month might seem like a lot, if you have a household with kids or roommates, it’s not too difficult to approach those limits using today’s services, even without heavy BitTorrent usage.

And it should noted that US limits are far from the world’s worst: Canada’s recently imposed restrictions prompted Netflix to give customers there a choice of lower quality streams to keep their usage down since users are charged up to $5 per GB they exceed their cap. Caps are also worse in Australia.

But for the nation which has been key to a wildly expanding Internet, the changing tide is both a practical and cultural letdown.

The drive to cap usage is ostensibly a way to reduce costs. But in reality, it’s not about the cost of data—bandwidth costs are extremely low and keep falling. Time Warner Cable brought in $1.13 billion in revenue from broadband customers in the first three months of 2011, while spending only $36 million for bandwidth—a mere three percent of the revenue. Time Warner Cable doesn’t currently impose bandwidth caps or metering on its customers—though they have reserved the right to do so—after the company’s disastrous trial of absurdly low limits in 2009 sparked an immediate backlash from customers and from DC politicians.

The real problem ISPs want to fix is congestion due to limited infrastructure. Cable customers share what are known as local loops, and the more that your neighbors use their connection, the less bandwidth is available to you—-a situation that becomes painfully clear in the evening when cable users see their throughput fall.

The blunt force approach of a bandwidth cap does have the advantage of making users think twice about streaming HD movies from Netflix. That is, perhaps not coincidentally, doubly to the advantage of most big ISPs, because they’d rather have you spending money on their video services than a third party. Bandwidth-intense services threaten to turn the likes of Comcast, AT&T and Time Warner Cable into utilities—a dependable business, but not one that has the huge profit margins these companies have come to enjoy.

Indeed, the question of who gets to write the rules about the Internet’s pipes is the major bone of contention in the net neutrality debate, both for terrestrial and mobile data networks. When the new net neutrality rules go into effect, ISPs won’t be able to block their online video competition, but there’s no rule against doing that via bandwidth caps or tiered usage pricing.

Moreover, as we all move towards more and more cloud services, whether that’s for backups, music or movies, it’s worrisome that ISPs are more concerned about reining in their most dedicated customers in service of meeting Wall Street’s expectations. Instead, they should be taking the opportunity to dig up the streets to create fiber networks that will make us a nation that’s top in the world’s broadband ranking chart, rather than a laggard.

The real solution is adding infrastructure at the local level, though an interim solution could entail metering data only during peak times, much as mobile phone calling minutes plans apply only during peak hours.

But that just goes to show, yet again, that what’s good for the Street often doesn’t translate into what’s good for the country.

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116 Reader Comments

Don't be fooled, this is about pushing DSL subs into uverse. AT&T wants more money per head and this is one of the ways they've decided to get it. It would be totally transparent if they hadn't throttled uverse, and now it's "going to be 250GB, but don't worry about it now and sign up!". Read the 2011 EULA for AT&T DSL subs - states they can move any DSL sub over to uverse internet whenever they please. Uverse subs are stagnant and AT&T will show improvement to shareholders any way they can.

I was strongly considering switching from TWC to U-Verse about a year ago, but AT&T's service area stopped about a block away from my house. Glad I didn't switch (both because of this and because most people I know who switched have had troubles with their service), but unfortunately I see this as leading to TWC instituting caps to "keep up with the competition" and unfortunately TWC is still my only option for broadband where I live.

It's also not likely to be coincidental that they announced this policy right after the tragic earthquakes in Japan and the increasing unrest in the Middle East. Got almost no news coverage outside of Ars and tech blogs. They know what they're doing.

Had AT&T Uverse 24Mbps down and 3Mbps up. We did have the U100 TV package but decided that it was too expensive for the little bit of channels we actually watched so we bought an antenna and pull the locals over the air now. Anyway when I heard about the caps coming, I got pissed because that meant I would have to trust AT&T to keep accurate data on it, which I don't have any faith in whatsoever, and it is another thing in my life I would have to worry about. The other day, had a door-to-door Time Warner salesman drop by. At first I would of normally waved him off, but thanks to AT&T I gave him his turn to sale me on a better deal. Turns out they did have a better deal. I now get Time Warner Wideband 30Mbps down and 5Mbps up for $10/month cheaper with no caps, at least yet. Not only do I get 30Mbps, I get it and then some, sometimes 31Mbps on speed tests. When I download from Usenet, I am pulling down files at 33Mbps+. Anyway the best thing I did was to leave AT&T, good riddance!

If I had AT&T DSL or Uverse and no other alternative in town, I would downgrade my service to the bare minimum. If they ask why, say that if they are going to have the same cap for all tiers, why should I have a faster connection that would get me to my cap even quicker? Since they are going to cap my Internet, I am going to cap them on their services which means less money in their pocket. If millions did this downgrade in service, I think they would have to do something.

I'm a U-Verse subscriber. I am married with a teenage son and young daughter. Both like Netflix, my son and I are avid gamers and we utilize Steam for a lot of our games. So when I got this letter in the mail from AT&T in March, we decided to measure the data we use in the month of April before deciding what to do. We agreed that we wouldn't do anything outlandish, but simply go about out daily usage.

What we discovered is that with using Netflix (daughter watches She-Ra all the time and son watches a lot of anime), playing our games, re-downloading games from Steam, and general internet usage, the total for April was 189GB used. Now I'm sure that if we went and constantly re-downloaded our entire Steam library or were watching Netflix 16 hours a day that we'd hit that cap, but it seems ok for us.

While I am ok with the 250GB cap, when I'm not ok with is the way by which they are going to measure the service. Having U-Verse means that all of your content is IP traffic based. So after logging onto my router I noticed that for that same month a total of 1.04 TB of traffic went through my U-Verse router. So the breakdown was:

The numbers don't surprise me, but what will is when I get a bill from AT&T because they mix up IPTV usage for my Internet usage. I'm concerned that while AT&T gave us 60 days notice before the caps were to be implemented, they have YET to provide us with the proper tool to measure said usage. Without that tool, it becomes a he said/she said if we were ever to get into a billing dispute.

I feel for you my American cousins, I really do. My isp has just REMOVED their 300GB cap. Delicious, unlimited fiber @ 40mb/s because of countless isp's all trying to out do each other on price/performance.

The other day, had a door-to-door Time Warner salesman drop by. At first I would of normally waved him off, but thanks to AT&T I gave him his turn to sale me on a better deal. Turns out they did have a better deal. I now get Time Warner Wideband 30Mbps down and 5Mbps up for $10/month cheaper with no caps, at least yet. Not only do I get 30Mbps, I get it and then some, sometimes 31Mbps on speed tests. When I download from Usenet, I am pulling down files at 33Mbps+. Anyway the best thing I did was to leave AT&T, good riddance!

I'm confused. I thought you were trying to portray yourself as a common sense, well informed consumer. If that's the case, you're doing it wrong by letting a door to door salesman talk you into a deal because you're feeling like a jilted lover with AT&T.

By the way, nice name drop on the Usenet. I'm sure there's so many legit uses for downloading like a fiend off of usenet *rolls eyes*

I flashed my Buffalo router with a supported version of DD-WRT which offers very comprehensive real-time and statistical bandwidth monitoring. It offers daily and monthly totals with many months of exportable history. I highly recommend it for those who need to monitor their bandwidth.

FWIW, I've been using Tomato for 6+ years with bandwidth stats saved to a cifs share on w2k3 box

Yeah, that doesn't strike me as that much, Eric. I live in a two-adult, one-child household with Netflix, and plenty of online video watching and working from home:

Luckily, Qwest has never throttled their DSL as near as I can tell. I pay for their 40/20 service, and while I usually only get 23/16, you can still chew through a lot of bandwidth very quickly.

So who is this going to hurt? The content providers. If one needs video that is going to be watched over and over again, am I going to use a legitimate streaming service for it or, am I going to download it once from bit torrent?...

I doubt this would lead me to torrent more (only thing I torrent now are game updates and linux distros), but it would make me reconsider what I stream and consider renting and ripping media when that option is available versus using legit services to stream it.

So has anyone heard if RoadRunner is planning a return to the cap idea? I *just* signed up for Hulu Plus and now I'm wondering if I'll have to pay extra someday because I overused it. Netflix isn't such a big issue yet since I really got that for DVDs...

Problem with all the apologists who are ok with practices such as this one is that it sets dangerous precedent. This is just like airline bag fees and the PR bullshit that they create to justify what really comes down to increased profits. The only problem is that telcos are basically a monopoly for all intents and purposes (and airlines are colluded monopoly).They are going to implemnent caps today, and tomorrow they will start charging you extra for netflix, facebook, games, im and email.

So has anyone heard if RoadRunner is planning a return to the cap idea? I *just* signed up for Hulu Plus and now I'm wondering if I'll have to pay extra someday because I overused it. Netflix isn't such a big issue yet since I really got that for DVDs...

They haven't announced plans since trialing and abandoning the idea in 2009. That doesn't mean they won't return to the idea again though. Thanks to MLB.tv, ESPN3, Netflix, Xbox live, and digital download purchases (music and software), I would definitely be a customer who exceeds or comes close to exceeding a 250 GB cap if it were implemented. When TWC/RR was trialing their caps in 2009, they set them at between 10GB and 100GB depending on what plan you had and were charging a $1 per GB extra for overages.

Does that mean Charter doesn't cap? To think they're the worst cable company (in my opinion) yet they don't cap.

From Charter's website:"EXCESSIVE USE OF BANDWIDTHThe Service is for residential use and only within limits that Charter considers reasonable for the service level to which Customer subscribes. Residential service usage for Customers subscribing to the Lite or Express packages should not exceed 100 Gigabytes ("GB") of data per month. Usage for Customers subscribing to the Plus or Max packages should not exceed 250 GB of data per month and usage for Customers subscribing to the Ultra60 package should not exceed 500 GB of data per month. Charter reserves the right to revise or implement additional usage limits at any time.It is a violation of this Policy to use the Service in excess of these limits. In these cases, Charter may, in its sole discretion, notify Customer of excessive use and (i) request Customer to employ corrective or self-limiting actions to comply with this provision; (ii) suspend or terminate Customer's Service account; or (iii) request that Customer subscribe to a version of the Service (such as a commercial grade Internet service, if appropriate) for use at higher data consumption levels that align with Customer's usage patterns. Charter's determination of the data consumption for Service accounts is final."

Anyone have information on whether AT&T is only rolling this out in limited areas? I'm an AT&T DSL customer and have been keeping an eye on their correspondence looking for an announcement of the of caps for the last few months, but haven't seen anything so far. Has anyone w/ AT&T actually received any kind of notice?

I'd consider switching away from AT&T just on the principle of opposing caps (currently use ~70-100 GB/month, so this won't have any immediate effect on me), but the only alternative in my area is Comcast, which already has caps in place (and I hate Comcast with a passion - evil, evil bastards). Aside from these threatened caps, I've been very happy with AT&T for internet, I actually get slightly faster than advertised speeds and in the last five years it has gone down maybe twice.

I flashed my Buffalo router with a supported version of DD-WRT which offers very comprehensive real-time and statistical bandwidth monitoring. It offers daily and monthly totals with many months of exportable history. I highly recommend it for those who need to monitor their bandwidth.

FWIW, I've been using Tomato for 6+ years with bandwidth stats saved to a cifs share on w2k3 box

Yeah, that doesn't strike me as that much, Eric. I live in a two-adult, one-child household with Netflix, and plenty of online video watching and working from home:

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Luckily, Qwest has never throttled their DSL as near as I can tell. I pay for their 40/20 service, and while I usually only get 23/16, you can still chew through a lot of bandwidth very quickly.

I didn't claim to be a high usage household, hence my concern being with QoS vs. data caps. But now that I think about it, last month's bandwidth was incurred with an MLB.TV subscription since April 15, so I will probably start seeing more usage resembling yours once I get my ass in gear and buy Apple TV, a new TV, and switch to Netflix streaming. We watch no TV (except baseball) and my son is only 2 so all of my bandwidth is inet. Not sure what my phone usage would be. It's mostly for alarm system.

Problem with all the apologists who are ok with practices such as this one is that it sets dangerous precedent. This is just like airline bag fees and the PR bullshit that they create to justify what really comes down to increased profits. The only problem is that telcos are basically a monopoly for all intents and purposes (and airlines are colluded monopoly).They are going to implemnent caps today, and tomorrow they will start charging you extra for netflix, facebook, games, im and email.

So bandwidth caps are going to be the slippery slope that gets us to net neutrality laws? Take off the tin foil hat please. I'm an apologist because this bandwidth cap as it turns out doesn't affect me unless I go out of my way to do so? Whatever.

If you want to fight 'the man' then why not just choose a different company to do business with? AT&T is not a monopoly on cable/internet access despite what you might think. Here in Wisconsin, you can choose to go to Time Warner Cable or Charter Cable for your TV/Internet/Phone services. If you're looking for just internet services there's Time Warner Cable, Charter Cable, Verizon, Covad, TDS Metrocom, MilwaukeePC, the list goes on.

As for your analogy to the airlines and fees, my wife and I planned a trip to Las Vegas earlier this year and chose not to pay for bag fees by simply going with Southwest. I guess Southwest decided to not get in on that sweet 'collusion monopoly' action you were talking about.

So in conclusion, this 'apologist' recommends that if you don't like the way a company is acting, you are free to take your business elsewhere.

I guaran-damn-tee you that you'll never get more that 1 Phone Co. or more that 1 Cable Co. offering at the same residence.

At my house, my landline broadband choices are Time Warner and that's it!Many, many unlucky folks have a choice of Comcast and nothing else.Now folks who can choose AT&T or Comcast just got screwed over even worse.

I dropped AT&T two weeks ago. I made sure to mention why I was leaving to the customer service rep who handled my case. Also, when they asked what I was downloading so much that I couldn't stay under 150GB, I said, "Porn. Lots of porn."

If you want to fight 'the man' then why not just choose a different company to do business with? AT&T is not a monopoly on cable/internet access despite what you might think. Here in Wisconsin, you can choose to go to Time Warner Cable or Charter Cable for your TV/Internet/Phone services. If you're looking for just internet services there's Time Warner Cable, Charter Cable, Verizon, Covad, TDS Metrocom, MilwaukeePC, the list goes on.

Where in Wisconsin do you live where you have all of these broadband provider choices available to one address? I'm also in Wisconsin and my current broadband option is TWC- no DSL options where I currently live (yeah there's satellite, but who honestly thinks that's a realisitic option unless you have no other choices). Best I've ever seen in Wisconsin is when I lived in Madison and I had 3 choices- 2 DSL providers and 1 cable. If TWC and Charter are crossing service areas anywhere in this state, it's extremely limited.

Boy, I'm glad I switched away from AT&T at my house. For those of you in the San Francisco Bay Area, perhaps you'll want to take a look at Sonic.net. They can't serve everyone with their ADSL2+ service, but if you're in range, perhaps it is worth a look.

In a way, I'm almost glad that AT&T imposed the cap 'cause otherwise, I would not have switched to Sonic.net's Fusion ADSL2+ service. Now I get 2X the download speed as well as POTS with caller ID and unlimited domestic LD for just a few dollars more per month.

It's good to know that AT&T doesn't have to match Netflix in quality. Hell, they can't even get on demand right-- they'll have 2 episodes in a short season just arbitrarily missing (Showtime On Demand if it matters). More to the point, they're leveraging their only interesting contribution, the network, to protect their sub-par products in typical monopolistic fashion.

Too bad for me that the reason I switched to U-Verse was that I had 3 truck rolls to straighten out my TWC cable, with one no call-no show, to no effect. That, and they've demonstrated that they'll cap if they can. I wish there was some ISP I could root for but, really, they're all scheming pricks.

Between my Netflix usage and my, thanks to Netflix, much reduced BT usage I suspect I'm in the >250GB/mo category. I think I'll enjoy calling them to let them know that I'm dropping their premium TV (and maybe TV altogether if possible/necessary) to pay for my Netflix bandwidth. Of course, I'll still be paying the pricks for less.

Anyone have information on whether AT&T is only rolling this out in limited areas? I'm an AT&T DSL customer and have been keeping an eye on their correspondence looking for an announcement of the of caps for the last few months, but haven't seen anything so far. Has anyone w/ AT&T actually received any kind of notice?

I'd consider switching away from AT&T just on the principle of opposing caps (currently use ~70-100 GB/month, so this won't have any immediate effect on me), but the only alternative in my area is Comcast, which already has caps in place (and I hate Comcast with a passion - evil, evil bastards). Aside from these threatened caps, I've been very happy with AT&T for internet, I actually get slightly faster than advertised speeds and in the last five years it has gone down maybe twice.

Same here except I have U-verse. There has been no correspondence as they're probably trying to be low profile about this. As noted earlier in the comments, you can't even get to their metering utility site yet. I too hate Comcast, and have avoided them for 10 years. Not sure what I'll do if I run into the limit. I guess I could move.

Ask your ISP about business accounts. There are no caps on business accounts for DSL or Cable. Of course they are at least 2 times more cost. But you also get service assurance over a consumer account.

I got Uverse, and I used to tell people how much it rocked. Now I'll tell them that they need to see if they have any providers that don't have data caps. Not that most people here do.

We are so far behind so many other countries because we don't have any competition. And everytime a new competitor rears it's head (municiple wifi/city fiber) the telecoms RACE to their bought and paid for government reps to shout how such things are anticompetitive.

Remember, bad is good, up is down, and more competition is anticompetitive.

So now AT&T can flood me with phantom traffic during slow hours to pump up their wallet. I still havent recieved any notice of this change to my service. I find it hard to believe that they can get away with this while not providing us any sort of auditing tool.

ah, finally, the centralization of power in Internet services is yielding the massive benefits that AT&T promised - higher prices for less services.

But guess what ! Its just the beginning.

The next step is to BS about how the folks that want certain *kinds* of access are really getting away with 'stealing' from others. You'll get a $2 a month discount while the users of video over Internet will pay $2 more, for starters. Next year, your rate will increase, because of 'increased costs' to $4 over what you pay today and the video over internet user will pay $8 more per month.

Once that BS is accepted, the VoIP, man, the Internet is like having a needle directly in the arm of consumers. But not just one needle, one at home, on in your phone, one in your Car, one in your iPad / notebook. Needles in all arms and legs, each one bleeding more out, providing less and less..

I enjoyed the ads running recently - AT&T is investing *millions* in their network - yes, in *Billing* equipment for the network.

When will the Nation realize that Bigger is not better, Internet access is not like buying boats and jewelry, its a utility, like water or electricity. Wouldn't it be great if you could re-direct water-packets from Avian and Coke over municipal conduits, so you could vary the charge for water.

Oh, wouldn't that be a great economic innovation. The innovations are in products for the Internet, not connectivity. One can only hope Investors will get smart about AT&T's use of 1950s business concepts in this millennium.

another reason to break up these incredibly destructive huge telecom monopoles. Because Canada has the same problem doesn't justify it here..

A new Internet is needed and I'm ready to invest in an open, high performance network, that encourages innovation rather than simple taking money out of the pockets of Internet users and handing it to a handful of 'investors' / carpet baggers.

How is this not seen as an anti-competitive action against a number of internet based companies such as Netflix, Amazon, Apple, Microsoft, Google, & other cloud based storage companies such as Backblaze.com?

I can't image they'd have to try hard to find a case to sue the big telcos for this shit.